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F I S C A L I M P A C T R E P O R T

SPONSOR Wirth

DATE TYPED 1/31/05

HB 148

SHORT TITLE Create Museum Collections Fund

SB

ANALYST Hadwiger

APPROPRIATION

(in $000s)

Appropriation Contained Estimated Additional Impact Recurring

or Non-Rec

Fund

Affected

FY05

FY06

FY05

FY06

Indeterminate

Recurring Museum Collec-

tions Fund

(Parenthesis ( ) Indicate Expenditure Decreases)

REVENUE

Estimated Revenue

Subsequent

Years Impact

Recurring

or Non-Rec

Fund

Affected

FY05

FY06

Indeterminate

Recurring Museum Collections Fund

(Parenthesis ( ) Indicate Revenue Decreases)

SOURCES OF INFORMATION

LFC Files

Responses Received From

Cultural Affairs Department (DCA)

State Treasurer

SUMMARY

Synopsis of Bill

House Bill 148 would create a Museum Collections Fund in the state treasury, a non-reverting

fund administered by the Cultural Affairs Department (DCA) and appropriated to that depart-

ment to fund new museum acquisitions. Revenues to the fund would come from the proceeds

from deaccessioning museum collection items and from interest earned. Each museum would

receive a subaccount in the fund to acquire objects for its own collection. Money would be ex-

pended on warrant of the secretary of the Department of Finance and Administration pursuant to

vouchers signed by the director of the appropriate museum division and the DCA Secretary or

his authorized representative.

House Bill 148 -- Page 2

Significant Issues

DCA provided the following comments: De-accessioning is a standard practice nationwide in

museums, as a means of strengthening collections’ quality. Museums strengthen their collec-

tions by careful and thoughtful “pruning.” State museums’ collection storage areas are seriously

over-crowded. Irrelevant collection objects that do not support the museums’ missions and pro-

grams should be de-accessioned. Currently, existing state law requires that revenue generated

from sales would go to the General Fund. This is in contradiction of the accreditation standards

of the American Association of Museums (AAM) and has prevented the museums from de-

accessioning. AAM accreditation standards mandate that revenue from sales of de-accessioned

collections objects must be used solely for new collections acquisitions. If these standards are

not followed, state museums risk losing their accreditation.

The AAM standards are consistent with the DCA comments: “Accredited museums abide by the

AAM Code of Ethics for Museums, and by any additional codes of ethics particular to their disci-

pline. The AAM Code of Ethics for Museums specifies that proceeds from sales resulting from

deaccessioning can only be used for acquisitions or direct care of collections. While the interpre-

tation of “direct care” varies between museums and disciplines, there is a strong consensus that it

does not include use of funds to pay operational expenses. The code of ethics of the Association

of Art Museum Directors explicitly specifies that art museums can only use funds resulting from

deaccessioning for the acquisition of new collections, and that of the American Association of

State and Local History specifies that history museums can use such funds only for acquisition or

preservation.”

FISCAL IMPLICATIONS

DCA indicates that state museums have not decommissioned items in their collections to date

because statute would conflict with standards of the museum profession. If this is the sustained

practice of the DCA, there would be no impact on the general fund if this bill were passed. On

the other hand, if this practice were not sustained, the general fund would lose all revenues from

the sale of deaccessioned items.

Continuing Appropriations

This bill creates a new fund and provides for continuing appropriations. The LFC objects to in-

cluding continuing appropriation language in the statutory provisions for newly created funds.

Earmarking reduces the ability of the legislature to establish spending priorities.

To address this concern, the bill could be amended on page 1, line 21 to delete “is appropriated

to the department” and insert in lieu thereof “shall be retained by the department for use, subject

to appropriation by the legislature,”. This is consistent with existing statute with regard to simi-

lar dedicated revenues.

ADMINISTRATIVE IMPLICATIONS

The State Treasurer indicated HB148 would add administrative tasks and burden to that agency.

DH/yr